Texas A&M awards contract to privatize services

AUSTIN — Texas A&M University on Thursday announced hiring a private company to run its campus dining, landscaping and building maintenance and cleaning services in a deal officials say is worth about $260 million in cash and savings for the school over the next decade.

As part of its contract, North Carolina-based Compass Group will pay Texas A&M $45 million and spend another $30 million renovating campus dining facilities, A&M System Chancellor John Sharp said.

Sharp’s call to privatize food and other services had created some worries that hundreds of jobs at the A&M system’s flagship campus would be in jeopardy. But Sharp said the company has agreed to keep current workers in their jobs and match their current salaries and benefits.

Compass Group provides food and support services to about 300 colleges and 6,000 schools nationwide, including Texas A&M University-Corpus Christi, a member of the A&M system, which uses the company for its custodial services. The Texas A&M contract announced Thursday does not include taking over concessions sales at Texas A&M athletic facilities.

Compass Group stands to profit from meals it sells and serves on one the largest campuses in the country. Steven Moore, vice chancellor for communications for the A&M system, said the school won’t be paying Compass Group to cut grass or maintain buildings. How Compass Group makes money from those ventures “is up to them,” Moore said.

Texas A&M and other state colleges and universities have come under increasing financial pressure from state budget cuts. Sharp said he was looking for significant cost savings when he ordered the university to explore privatizing services several months ago.

Campus dining, for example, ran an annual deficit of up to $2 million, Sharp said.

“It’s time to be creative in how you work,” Sharp said. “What we are here for is teaching and research. Everything else is here to support that.”

Most of the other 10 schools in the A&M system had already privatized dining and other services “years ago,” Sharp said

The $260 million figure includes the cash payment as well as the money the school won’t have to spend on salaries, benefits and renovations. Sharp says that money can now be put into academics although the school has not decided yet exactly how to spend it.

“The core function of the university is teaching and research, and we now redirect that money to those areas,” Sharp said.

Sharp also promised better campus food.

“If you want a vegetarian plate, they can fix you a vegetarian plate,” Sharp said. “I suspect the food will be better. The landscaping will be better. The maintenance will be done better.”